Universal credit continues to confuse

Confusion continues to grow amongst tenants over the Government’s Universal Credit scheme according to recent research from the National Landlords Association (NLA).

Half (50 per cent) of tenants surveyed say that although they’re aware existing benefits will be replaced with Universal Credit, they don’t fully understand what it means.

And alarmingly one in five (21 per cent) say they are completely unaware of the changes. Just three in ten (30%) say they’re aware and know what to expect.The findings also show that currently three in ten (30%) tenants say they receive housing benefit support.Universal Credit, which was launched in April 2013, replaces six existing benefits with a single monthly payment. The changes, combined with recent cuts to the benefit system, have led to increasing concern among landlords with housing benefit tenants about whether rent will be paid on time.

However, the research also shows that more than a quarter (28 per cent) of tenants currently in receipt of housing support said they would prefer their benefit to be paid directly to their landlord, which would avoid falling into arrears.

Carolyn Uphill, Chairman of the NLA, commented:

“Benefit payments simply haven’t kept up with rents over the past few years as the Universal Credit programme has progressed and cuts to welfare payments have been made. This has led to concern among many landlords that tenants will fall behind on rent as their finances become increasingly squeezed.

“If tenants don’t fully understand what Universal Credit is or haven’t even heard of it, more and more landlords will lose confidence that letting to this market is financially viable, especially with the high demand and availability from other types of tenants.

“Our findings show a significant number of tenants would prefer their housing support to be paid directly to their landlord.

If this was an option from the beginning of the tenancy it would avoid the build-up of arrears in the first place, give landlords the confidence that rent would be paid on time and lead to fewer tenancies ending prematurely.”